Future Stock Shock: Can World Produce Enough Fish to Feed Demand in USA?

Per capita consumption may not be growing, but the population is -- and that means the United States will need a huge increase in supply to meet demand.

Looking just at per capita consumption to measure the state of the industry ignores the fact that population increase alone dictates

In 1998, US per capita seafood consumption rose 0.3 pounds to 14.6 pounds. This compares with the record year for per capita consumption of 16.2 pounds in 1987. Was 1987 a better year for the industry?

In 1987, the US population stood at 240.6 million, meaning that total consumption for that year on an edible weight basis totaled 3.9 billion pounds. By 1998, the nation's population had grown to 269.1 million and the total edible weight consumed was 4.0 billion pounds.

So while per capita seafood consumption fell some 1.3 pounds, total consumption increased by 100 million pounds on an edible weight basis or approximately 300 million pounds on a round weight basis.

The Bureau of the Census has provided population estimates for the next 20 years; unfortunately, the National Marine Fisheries Service (NMFS) is unable to give us any idea as to supply. When the US population reaches 300 million, an additional 500 million pounds (edible weight) of supply will be required to maintain current per capita consumption levels; on a round weight basis, this equals roughly another pollock fishery.

What are the prospects for future increases and decreases in United States seafood supply? What are the factors that could increase supply? Over the next several decades, there are any number of factors that could contribute to increased seafood availability, from both capture sources and aquaculture. These include:

Stock Recovery

Although the National Oceanic and Atmospheric Administration (NOAA) lists 109 fishery stocks as "fully utilized" and another 62 as "over-utilized," NOAA's long-term strategic plan envisions a 10-year rebuilding effort that could ultimately increase domestic fishery production.

At present, the recent average yield of wild stocks is 7.2 million metric tons. However, according to the NMFS, the long-term potential yield is 12.0 million metric tons. This recovery will be achieved, according to the National Oceanic and Atmospheric Administration (NOAA), through elimination of overfishing, prevention of future overfishing and the rebuilding of stocks to levels that support maximum sustainable yields.

Conservation and environmental initiatives, such as marine sanctuary zones and non-science based gear reduction and restrictions, will negatively impact supply.

Discard/Bycatch Utilization

Currently, a number of fisheries result in incidental catch of non-targeted species. In the past, this "bycatch" was usually discarded. A number of fishery management schemes currently contemplated or implemented call for retention of bycatch. How effective these regulations will be, and in what form the product will be utilized, will dictate whether this will contribute any significant volume to overall supply.

Increase in Processing Yields

On average, just a third of round weight is converted into edible weight. Increases in yield through improved processing recovery and utilization could supplement the overall supply. A two percent increase would add 140 million pounds (edible weight) to the supply system. New processing technology has resulted in increased recovery of edible protein. The Alaska pollock fishery has benefited from increased yield during surimi processing.

Underutilized Species

According to NMFS, some 36 wild stocks are identified as "underutilized." These stocks are generally underutilized because there is minimal market demand or because the stocks are managed within a larger grouping (as is the case with a number of Alaska groundfish species).

Many of these underutilized species are less attractive to the American palate, such as mackerel or anchovies, while others present technical challenges -- such as arrowtooth flounder, which poses processing challenges.

Aquaculture Production

Domestic aquaculture production currently contributes approximately 800 million pounds (200-300 million pounds edible weight) to the US seafood supply.

Catfish dominates US aquaculture production and has been increasing steadily for well over a decade. In 1999, US catfish output reached 600 million pounds (live weight basis), up 250 million pounds since 1987. Catfish production is relatively low-tech and further increases are likely.

Additional contributions could come through culturing of new species (flounder, halibut, etc.) and open-ocean farming.

On the negative side, government regulations affecting water usage and quality as well as limited site availability (with optimum growing temperatures) will mitigate aquaculture expansion.

Several factors that could increase domestic aquaculture production (beyond catfish) are still problematic. These include the use of genetic engineering to produce larger fish, advances in closed-system re-circulating systems and changes in Alaska laws to allow fish fanning in that state.

Increased Imports

As the level of domestic seafood harvesting has plateaued, the industry has come to rely more heavily on global resources to meet demand. Currently, imported seafood represents over 50 percent of total US consumption (after adjusting for exports), and this figure is likely to increase in the future.

In 1999, 3.9 billon pounds of seafood valued at $9.3 billion were imported while exports totaled 1.9 billion pounds worth $2.8 billion, resulting in a seafood trade deficit of $6.5 billion -- a record.

Shrimp is the leading import item, with a value of $3.1 billion for 331,706 metric tons. Other leading imports include whole and canned tuna, lobster, salmon (whole and fillets) and groundfish fillets. Aquaculture products represent a significant component of US seafood imports. Shrimp, salmon and scallops all rank high on the import list.

With limited prospects for expansion of domestic supply, the question is how much more can imports increase to feed demand?

In 1997, the United Nations Food and Agricultural Organization (FAO) forecast that by the year 2010, world seafood production could total 107-144 million metric tons (versus 122 million in 1997). The wide range includes a pessimistic scenario where overfishing, bycatch discard, pollution and non-compliance with international conservation and management measures remain unresolved.

The high estimate takes into account gains in aquaculture and initiatives by the FAO and major fishing countries to move toward sustainable fisheries that can be expected to limit expansion in the near term but may offer increased production in the long term, as better resource management restores leading fisheries to their full harvest potential. Currently, however, only four of the top 20 capture fisheries (pollock, Atlantic cod, skipjack tuna and yellowfin tuna) have significant markets in the United States.

Increased availability of world seafood supplies for the US market will be helped by projected decreases in population in Japan and Western Europe. In addition, a continued strong dollar will allow US importers to "outbid" others for product. The continued expansion of global aquaculture, particularly shrimp, salmon and tilapia, will improve supply prospects.

On the other hand, demand for seafood in China could alter the world supply equation significantly. China is already a net importer of seafood.

Conclusion

So what does the future hold for US seafood supply -- and can per capita consumption levels in the 15-pound range be sustained over the long term?

With so many supply variables, it is difficult to make firm projections. However, we do know that the US population will increase and consumers will continue to desire the taste, quality, variety and health benefits that seafood delivers.

In order to maintain per capita consumption at 15 pounds per capita in 2025, an additional 920 million pounds (edible weight) of product would be required. On a round weight basis, this is equivalent to another Alaska pollock fishery -- approximately 2.7 billion pounds.

Crunching all the numbers, it appears likely that there are still growth opportunities for the US seafood industry. A modest recovery of domestic capture fishery production, coupled with increases in aquaculture and net trade (more imports than exports), should maintain pace with population growth.

Certainly there will be surprises -- as there always are with commodities. Some products will be more available, some less. However, the future looks promising for continued supplies to the US market.

U.S. Edible Seafood Imports and Exports 1990-1999 Million Pounds Round Weight

Year         1990     1991     1992     1993     1994

Imports     5,621    5,989    5,624    5,607    5,778

Exports     3,396    3,564    4,123    4,386    4,306

Net         2,225    2,425    1,501    1,221    1,472

Year         1995     1996     1997     1998     1999

Imports     5,917    6,150    6,495    7,001    7,421

Exports     4,261    4,374    4,326    3,709    4,377

Net         1,656    1,776    2,169    3,292    3,044

Editor's Note: This article was originally written as a white paper commissioned and first posted by Fishmonger.com, which recently merged with Worldcatch.com.(www. worldcatch.com). The author is president of H.M. Johnson & Associates, a seafood marketing and market research company based in Jacksonville, Oregon, USA. He publishes the Annual Report on the United States Seafood Industry and is a frequent industry speaker on trade and consumer trends. His web site is www.hmj.com, and he can be reached by e-mail at howard@hmj.com.

ZIMBABWE

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